MORNBFI Vol. 1 - Planters Development Bank

§§ 4303Q11.12.31the payment of principal and interest; (c)loans fully secured by US Treasury Notesand other securities issued by centralgovernments and central banks of foreigncountries with the highest credit qualitygiven by any two (2) internationallyaccepted rating agencies; (d) loans to theextent covered by the hold-out on orassignment of, deposits maintained in thelending QB and held in the Philippines;(e) loans and acceptances under letters ofcredit to the extent covered by margindeposits; and (f) other loans or creditswhich the Monetary Board may, from timeto time, specify as non-risk assets, shallat no time exceed twenty-five percent(25%) of the combined capital accountsas defined in Sec. 4111Q.The total liabilities of any borrowermay amount to a further fifteen percent(15%) of the combined capital accountsof such QB: Provided, That the additionalliabilities are adequately secured by realestate mortgage, assignment or pledge ofreadily marketable bonds and other highgradedebt securities, except those issuedby the lending entity.The total amount of loans, creditaccommodations and guaranteesprescribed in the first paragraph may befurther increased by an additional fifteenpercent (15%) of the net worth of suchQB: Provided, That the additional loans,credit accommodations and guaranteesare granted to finance oil importation ofoil companies which are not subsidiariesor affiliates of the lending QB engaged inenergy and power generation: Provided,further, That the oil companies qualifyunder the credit underwriting standardsof the lending QB and the lending QBshall comply with Subsec. 4301Q.6 onthe guidelines in managing largeexposures and credit risk concentration:Provided, furthermore, That the credit riskconcentration arising from total exposuresto all oil companies shall be consideredby the QB in its internal assessment ofcapital adequacy relative to its overall riskprofile and operating environment andshall be incorporated in the ICAAPdocument required to be submitted underSec. 4119Q: Provided finally, That theadditional fifteen percent (15%) shall onlybe allowed for a non-extendable periodof two (2) years from 03 March 2011. Saidadditional loans, credit accommodationsand guarantees outstanding as of the endof the two (2)-year period and in excessof twenty five percent (25%) of the lendingQB’s net worth shall not be increased butshall be reduced and once reduced, saidexposures shall not be increasedthereafter.For purposes of this Section, the termliabilities shall mean the direct liability ofthe maker or acceptor of paper discountedwith or sold to such QB and the liabilityof the endorser, drawer or guarantor whoobtains a loan from or discounts paperwith or sells papers under his guaranty tosuch QB and shall include in the case ofliabilities of a co-partnership orassociation, the liabilities of the severalmembers thereof and shall include, in thecase of liabilities of a corporation, allliabilities of its subsidiaries: Provided, Thateven in cases where the parentcorporation, co-partnership or associationhas no liability to the QB, the liabilities ofsubsidiary corporations or members of theco-partnership or association shall becombined for purposes of the singleborrower’s limit (SBL).Loans, credit accommodations andguarantees to any person, partnership,association, corporation or other entityor group of companies in excess of theapplicable SBL arising from acquisition,merger or consolidation of borrower-Manual of Regulations for Non-Bank Financial InstitutionsQ RegulationsPart III - Page 5